UPS and FedEx announce sweeping surcharge changes for peak season
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E-commerce sellers and logistics professionals will face a steeper cost curve in late 2025 and early 2026. Both UPS and FedEx have announced rate changes that will significantly affect shipping strategies, especially for packages that are large, heavy, or traveling long distances. The updates reflect ongoing cost pressures in the parcel delivery sector and reveal how carriers are responding to the post-pandemic surge in residential shipping. Small businesses, in particular, will need to reassess how they pack, route, and price deliveries.
UPS adds size, weight, and zone-based surcharges to Mail Innovations
Starting October 5, 2025, and running through January 18, 2026, UPS will introduce a $2 surcharge for outbound packages using its Mail Innovations service. This applies to packages that meet any one of these criteria:
- Weigh more than 10 pounds
- Measure over 22 inches in length or exceed two cubic feet in volume
- Ship to Zone 9, a category that includes remote and non-contiguous U.S. regions
Additionally, UPS will implement a $0.30 per piece fee for all domestic packages shipped via the Parcel Select service. While these changes may seem minor on a per-package basis, their impact scales quickly for businesses processing thousands of orders per month.
This shift signals a recalibration in UPS’s low-cost shipping options, particularly targeting bulky or distant deliveries that strain last-mile resources. For high-volume sellers relying on Mail Innovations for cost-effective fulfillment, the margins are tightening.
UPS has also rolled out a savings initiative through a partnership with American Express. The UPS® Digital Connections program, part of the AmEx Business Savings Suite, offers small businesses access to discounted shipping, giving some relief from the added costs.
FedEx’s January 2026 changes signal a shift toward volume-based pricing
FedEx’s changes take effect in two phases. On January 5, 2026, its base shipping rates for FedEx Express, Ground, and Home Delivery will rise by an average of 5.9%. While this increase is in line with annual adjustments, more fundamental shifts begin a week later.
On January 12, 2026, FedEx will revise how it applies certain surcharges:
- Additional Handling – Dimension will now include cubic volume as a triggering factor, rather than relying only on length.
- Oversize surcharges will be assessed based on both volume and weight.
- Specialty services such as Appointment Home Delivery and Evening Home Delivery will shift from per-shipment to per-package pricing.
This change introduces greater granularity in how surcharges apply. A multi-box order that once incurred a single surcharge could now trigger multiple fees, increasing complexity and cost. Businesses shipping furniture, outdoor equipment, or other large but lightweight goods are likely to face higher bills.
Which businesses will feel the most impact from new surcharges
The cost increases will not be evenly distributed. E-commerce sellers dealing with oversized or heavy products will be affected the most. Categories such as home goods, outdoor equipment, and electronics are particularly exposed due to their frequent violation of dimensional weight limits or extended delivery routes.
Third-party logistics providers managing fulfillment for multiple clients may also see a rise in operating costs. This could translate into higher fees for their customers, particularly those who lack the volume leverage to negotiate discounted rates.
Dropshippers and marketplace sellers dependent on national carrier networks may find their profit margins squeezed further, especially if they lack control over packaging dimensions or inventory locations.
The upcoming fee changes are structured and granular, reflecting a larger shift in how UPS and FedEx are pricing delivery services in a high-cost environment.
As carriers continue to adapt to residential delivery patterns, labor constraints, and infrastructure demands, future changes are likely to follow similar logic. This means more specific criteria, broader surcharge coverage, and deeper incentives for cost-efficient shipping.